TeamLease Report: Positive Hiring Sentiments Reflect A Higher Demand For Vocational Skills

India is set to witness 7% rise in job creation in the period October -March this financial year. According to TeamLease’s bi-annual Employment Outlook Report for HY2 2019, positive hiring outlook was reported in healthcare and pharmaceuticals, information technology, e-commerce, and tech start-ups, educational services, knowledge process outsourcing, power and energy, and logistics. On the other hand, sectors like manufacturing, engineering and infrastructure, construction and real estate, financial services, retail, BPO/ITeS (business process outsourcing/IT-enabled services, telecommunications, travel and hospitality, FMCG (fast-moving consumer goods) and agriculture and agrochemicals are anticipated to witness negative net employment outlook.

In a survey, taken from 19 sectors across India, 7 sectors indicated an increase in the net employment outlook while 9 reported a decrease in their employment outlooks. The inference from the above outlook stipulates that India is expected to see a 7.12% rise in job creation during the October-March period. 

The research reflects the hiring sentiment and job creation across key cities and 19 sectors in India along with major business categories globally. Further, to ensure a complete representation of the population and to minimize biases in the predictive model the sample coverage was spread across different geographical areas like metros, tier-1, tier-2 cities, and rural areas. Multiple hierarchical levels such as entry-level, junior, mid and senior levels and different functional areas like sales, marketing, information technology, engineering, office services, human resources, and blue-collar were taken into consideration.

With an increase in the net employment outlook, the job market is witnessing a chasm between the demand and supply of skills across industries. The survey has been carried out using multiple data points from TeamLease’s temp salary database for 2016, 2017, 2018 and third-party job portal salary databases. It was observed that the current labor deficit in the vocational job market is expected to balloon to 61.4 m. As a result,  this will have a direct impact on the job market causing salaries to rise further.
The report also brought to light some interesting facts. For example, a visual merchandiser with 0-2 years of experience in the apparel industry got more money than an MBA or an electrical engineer with the same level of experience. The salary of a skilled electrician (with 5+ years of experience) rose from Rs 27,250 per month in 2016 to Rs 39,500 per month in 2018, while a network technician was able to take home Rs 51,600 in 2018 compared with Rs 38,000 in 2016.

As lack of employability continues to afflict long-tail higher education, the demand for vocational skills is increasing exponentially. According to TeamLease estimates, nearly 80% of the engineers from long-tail institutions (institutions ranked below 51) are not employable, while 99% of MBAs from long-tail institutions are not employable. Unskilled engineers earn Rs 10,000 to 15,000 per month at the start of their career, while poor quality MBAs earn as low as Rs 8,000-10,000 in their first job.

Taking the above factors into account it would be fair to predict that the job market in India will show a positive growth trajectory in the coming quarters. The increasing demand for skills is now not only coming from metros and tier-1 cities but is also from tier-2 and tier-3 cities. As per   Rituparna Chakraborty, Co-founder and Executive Vice President TeamLease: “Though the lowering of the GDP growth projection seems to have dampened the net employment outlook in some of the sectors, the job creation across sectors is on a growth trajectory.” She further added that “8 out of the 19 sectors are expected to witness a double digit rise in job creation. Logistics and educational services alone will add 14.36 per cent more jobs during the period October-March, 2019-20 indicating the  dip in the net employment outlook to be more of a passing phase.”

This news is indeed a happy one in the otherwise bleak economic scenario.

Comments are closed.